Among the prominent regional political parties in both the Telugu states, the TRS had more capital reserve than TDP and YSRCP in 2018-19, as per the latest data released by the Association of Democratic Reforms (ADR).
As per an analysis of assets and liabilities of the regional parties for 2018-19 across the country done by the Delhi-based think tank ADR, TRS had cash reserve funds of Rs 187.77 crore, TDP Rs 175.17 crore and YSRCP Rs 88.407 crore.
The capital / reserve fund is the amount set aside by the parties after subtracting liabilities from the total assets, every year, for party expenditure.
Interestingly, all the three regional parties from the two Telugu states were among the top 10 of the 41 regional parties analysed by ADR with the highest capital reserve funds.
ADR analysed the assets and liabilities of these 41 regional parties based on the declarations in their I-T returns submitted to the Election Commission of India.
Among the three parties TDP had more assets followed by TRS and YSRCP.
The assets declared by political parties fall under six major heads that is fixed assets, loans and advances, FDR / deposits, TDS, investments and other assets
TDP also had more fixed assets than TRS and YSRCP. While TDP had declared total assets worth Rs 193.27 crore, the party had Rs 115.86 crore in fixed deposits, Rs 18.52 crore in the form of loans and advances, fixed assets worth Rs 27.193 crore and Rs 31.697 crore in the form of other assets.
Of the total assets of Rs 188.73 crore declared by TRS, Rs 152.64 crore was in the form of fixed deposits, Rs 28.20 crore been declared under other assets, Rs 5.186 crore of fixed assets, Rs 2.367 crore under loans and advances and Rs 0.337 crore as TDS.
YSRCP had declared total assets of Rs 93.492 crore. Jaganmohan Reddy’s party had declared Rs 79.266 crore as other assets. The YSRCP had no fixed deposits and had fixed assets worth merely Rs 0.132 crore and Rs 14.094 crore in loans and advances.
Of the total debts of Rs 18.10 crore declared by TDP, borrowings like banks, overdraft and sundry creditors stood at Rs 17.94 crore and Rs 0.16 crore was listed as ‘others’.
YSRCP had comparatively lower liabilities of Rs 5.084 crore of which borrowings from banks, overdraft and sundry creditors stood at Rs 3.523 crore and Rs 1.561 crore of other liabilities.
“National and regional parties failed to adhere to the ICAI guidelines that direct parties to declare details of the financial institutions, banks or agencies from whom loans were taken. The guidelines specify that the parties should state the “terms of repayment of term loans” on the basis of due date such as a year, 1-5 years or payable after 5 years,” observed ADR in its report.
While there are a set of accounting standards set for commercial, industrial and business enterprises and these accounting standards are issued by the Institute of Chartered Accountants of India (ICAI), political parties fall under the non-commercial, non-industrial or non-business entity.
Thus, the standard accounting formats of the other entities are not applicable to political parties.
The Election Commission of India (ECI) requested the ICAI for recommendations to bring uniformity in the accounting and auditing practices of political parties. Following this, the “Guidance note on Accounting and Auditing of political parties” or the “Accounting guidelines” were formulated in February, 2012 by the ICAI on the request of the ECI, in order to improve accounting and auditing standards of political parties and improve transparency in their finances.
These guidelines lay down principles of recognition, measurement and disclosure items of income, expenditure, assets and liabilities in the financial statements of political parties.
“ICAI guidelines, on auditing of political parties which were also endorsed by the ECI in order to improve transparency in the finances of political parties, remain guidelines only and have not been actively taken up by the political parties as a mandatory procedure to disclose details of their income.
These guidelines were meant to standardise the format of financial statements of parties apart from improving disclosure of income, expenditure, assets and liabilities of the unique association, political parties,” rued ADR in its report. #KhabarLive #hydnews